New study finds number of innovative projects up dramatically in last two years.

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Despite the tough economic climate and increasingly competitive funding landscape, the Jewish innovation sector has grown dramatically in recent years. There are now 600 Jewish startups in North America that engage more than half a million Jews, up from about 300 startups in 2008, according to the findings of the 2010 Survey of New Jewish Initiatives produced by Jumpstart, the Natan Fund, and The Samuel Bronfman Foundation.

More than 150 of these Jewish startups – approximately 25 percent of survey respondents – have launched since 2008.

“It shows that the growth of the sector is almost exponential,” says Felicia Herman, executive director of the Natan Fund and co-author of the study. “In a horrendous economic climate, every year more and more people are taking their Jewish lives in their own hands and starting programs and initiatives.”

The study found that the leaders of these startups tend to be “insiders” who attended Jewish day school and summer camp, and grew up in homes where someone usually lit Shabbat candles. Nearly 95 percent of startup founders have visited Israel at least once. This is consistent with the findings of Avi Chai’s “Generation of Change” study and the Jewish Communal Service Association’s recent study of Jewish professionals.

“The theme that really comes out of this is the notion of empowered Judaism that Elie Kaunfer has written about,” Herman says, referring to the book by the co-founder of Mechon Hadar, entitled “Empowered Judaism.”

“We have a generation that is so well educated and so well connected and so empowered – partly by that education, partly by technology – to take their Jewish lives in their own hands, and create programs that work for them and for their peers. They come from the core of the Jewish community so they’re best able to identify holes in the system, what’s not working.”

The report offered a glimpse into the demographics of the founders of these innovative Jewish initiatives. While 60 percent of startup founders were raised Conservative or Reform, only 30 percent describe themselves as such today. Nearly 40 percent of startup founders say that they are “Just Jewish” or “post-/multi-denominational.”

These new organizations tend to focus on building Jewish identity, arts and culture, and the environment. “When it comes to social services, there are next to zero startups. Yet clearly social services needs attention,” says Jumpstart’s Joshua Avedon, who co-authored the study.

Among startups focused on Israel, they lean toward engagement and education rather than advocacy. “The connection of American Jews to Israel will take new and unfamiliar forms,” says Jumpstart’s Shawn Landres. “This will be uncomfortable for people used to the 20th century approach to Israel advocacy.”

While the largest startup – defined in the study as organizations launched in the past decade – reported a budget of $6.5 million, half of the startups have annual budgets of $80,000 or less. Most of these small organizations have even smaller donor bases, with 50 percent of startups reporting fewer than 45 donors. So while a majority of the organizations reported either an increase in revenues or holding steady from the previous year, there is a need to broaden the donor base among these startups, particularly as the organizations mature and look to increase their reach.

While resilient, “the sector as a whole still needs funding,” says Avedon. “We should be looking at the sector as a pipeline. There needs to be a communal will to provide more sustained and long-term funding.”

The report did not track the failure rate among Jewish startups, nor did it attempt to measure the impact of these new initiatives.

The growth of this sector, the report says, can largely be attributed to the “innovation economy” – the social capital and networks employed by these highly educated and well-connected startup leaders.

Still, funding is the necessary fuel to keep pace.

“The educations, backgrounds, and involvements, and connections of the leaders of this ecosystem inspire the idea,” says Herman. “But at end of the day, you also need money to pay the rent, run the programs, and set up the Website.”